US stocks rally hard ahead of the Fed decision

Major US equity indices opened with strong gains on Wednesday and recovered some of their steep losses over the past two trading sessions. 

Against the backdrop of better-than-expected earnings season, upbeat ADP report aided investors’ sentiment during the opening hour of trade. Data released on Wednesday showed private-sector employment increased by 234K from December to January, much better than 185K expected. 

The early upsurge was further supported by strong gains in technology and transportation stocks, and a modest retracement in the US Treasury bond yields, which was now seen driving flows back towards perceived riskier assets - like equities. 

Traders now brace for the latest FOMC decision, the last for the outgoing Fed Chair Janet Yellen, wherein the central bank is universally expected to maintain status quo and leave key benchmark interest rates unchanged. Only a relatively hawkish policy statement, indicating a faster pace of rate tightening cycle through 2018 could dampen investors' enthusiasm and pave the way for a deeper near-term corrective fall.

At the time of writing, the Dow Jones Industrial Average was up over 200-points to 26,286 and the broader S&P 500 Index gained nearly 14-points to 2,836. Meanwhile, tech-heavy Nasdaq Composite Index climbed around 50-points to 7,450.